On the eve of its second-quarter earnings release, shares of TSYS stock again enjoyed a high they haven’t experienced before.
The global credit-card and payment processor, headquartered in downtown Columbus, saw its stock touch $62.62 in early trading Monday on the New York Stock Exchange. The company held onto much of that gain, finishing the day up 83 cents per share at $62.40. The 52-week low is $46.22 per share.
The bottom line is TSYS, a major Columbus employer, has been hitting a series of all-time stock highs leading up to Tuesday’s release of its financial report for the April-June quarter. More than two dozen Wall Street analysts are expecting the company to report consensus earnings per share of 80 cents, up from 74 cents, according to Yahoo Finance.
With its earnings report approaching, TSYS has been reluctant to speak about the run-up in its stock price. However, media outlets have not. That includes a speculative story Monday by Investor’s Business Daily that TSYS, or Total System Services as it is legally incorporated, could be acquired in the next wave of financial industry mergers.
The article, citing Stifel equity research analyst John Davis, said that Fidelity National Payment Services and PayPal could be among the purchasers of other technology companies in the future. And, specifically, it said the prime target of Jacksonville, Fla.-based Fidelity very well could be TSYS.
“We think the deal that makes the most sense would be (Fidelity) acquiring Total System Services given the significant potential accretion coupled with the undeniable strategic and cultural fit,” Investor’s Business Daily quoted Davis in a research report. “We believe strategically it is a home run as it would give (Fidelity) significant scale in issuer credit processing as well as afford the company entrance into the faster growing, higher multiple merchant acquiring business.”
Fidelity is a Fortune 500 financial technology solutions company that offers software, services, consulting and outsourcing in the financial industry, according to its website. It has more than 20,000 clients in 130-plus countries. The company says its technology “powers billions of transactions annually that move over $9 trillion around the globe.”
Fidelity has 57,000 employees compared to the 11,500 on the payroll at TSYS, roughly 4,500 of those in Columbus. Its stock also is trading at a high level, closing at just over $90 per share Monday.
TSYS undoubtedly has made itself more attractive in recent years with its purchase of merchant specialty company TransFirst, the Columbus firm’s largest deal ever. That acquisition was preceded by its buyout of prepaid card specialty firm NetSpend. TSYS is now working to pay off debt related to the TransFirst purchase.
The release of the TSYS earnings report will come after the stock markets close Tuesday. Another Columbus-based company, supplemental health and life insurer Aflac, will issue its second-quarter report on Thursday afternoon.